You risk losing key people if you don’t have a method to lock them in – we recommend using equity.

As a business owner, you know how important it is to retain your top talent. Losing key employees can be costly, both in terms of productivity and revenue. That’s why it’s essential to have a method to lock them in and keep them motivated and committed to your company’s success. One of the most effective ways to do this is by offering equity.

Equity is a form of ownership in a company. When you offer equity to your key employees, you give them a stake in the company’s success. This can be a powerful tool for motivating and retaining your top talent. Equity can also help align your employees’ interests with the company’s goals, leading to better performance and increased productivity.

The benefits of offering equity to your employees are clear, but how exactly does it work? There are several ways to structure equity compensation, but the most common is through Employee Share Ownership Plans, which give employees the right to buy a certain number of shares of company shares at a set price, usually lower than the current market value. This allows employees to benefit from the company’s growth and success.

Offering equity isn’t just beneficial for your employees. It can also be a smart business move for you. By giving your key employees a stake in the company, you’re investing in their loyalty and commitment. This can reduce turnover and the costs associated with hiring and training new employees. Additionally, equity compensation can be tax-deductible for your business.

In conclusion, offering equity is a smart move if you want to retain your top talent and keep them motivated and committed to your company’s success. It aligns your employees’ interests with the company’s goals, increases productivity, reduces turnover, and can be a tax-deductible expense for your business. So don’t risk losing your key people – consider implementing an equity compensation plan today.

Dr Craig West

Founder & Chairman | Succession Plus

Dr Craig West is a strategic accountant who has over 20 years of experience advising business owners.

With a background as an accountant in practice and two master’s degrees, Craig formed a strong view that the majority of business owners (and often their advisers) were unprepared and unaware of the steps required to prepare for exit. He then designed and documented a unique 21-Step Business Succession and Exit Planning process to assist owners and their advisers in navigating this process.

Craig now acts as a strategic business and financial mentor for mid-market business owners. Craig has written four critically acclaimed books educating business owners on employee incentives, succession planning, asset protection, and exit strategies. Additionally, he has completed doctoral research on Employee Share Ownership Plans (ESOPs) for succession.

Craig is a Member of the Forbes Business Council where he leverages his extensive experience to contribute valuable insights on helping business leaders navigate the complexities of growing and exiting their businesses.

In April 2024, the Exit Planning Institute admitted Craig to the International Exit Planning Circle of Excellence.